The Big Data Challenges: A Case Study of Volvo Car Corporation

The Big Data Challenges: A Case Study of Volvo Car Corporation

Introduction

In August 2010 when Volvo Car Corporation break free from its parent company Ford, this marked a demerger of the company’s IT infrastructure from a previous one that was explicitly elaborate and that consisted of an extensive network and tangle of different licenses and systems (Volvo Group, 2012).  This created an immediate need for developing its new IT infrastructure that was stand alone hence essential in providing better Business Intelligence, enriching collaborations and boosting communication capabilities.  Therefore, this break free of Volvo Car Corporation from the IT infrastructure of Ford allowed it to develop and integrate new IT infrastructure, a move that saw significant changes been made on the company’s business operations (Volvo Group, 2012).

This research paper will judge how cloud infrastructure has been integrated into Volvo Car Corporation’s networks. The research paper will also provide an explanation on how Volvo Car Corporation has being transforming its voluminous data into knowledge as well as identifying the implemented real-time information systems and subsequently evaluating the impact of such implementations. Moreover, an argument of how the strategy of Big Data has given Volvo a competitive advantage in the market will also be finally presented.

Volvo Car Corporation Integration of Cloud Infrastructure into Its Networks

In the process of establishing IT systems for Volvo Car Corporation after it break free from Ford integration of cloud infrastructure was an invaluable strategy since the company collects terabytes of data from its cars through embedded sensors, from product design and development systems, from dealerships, from their customer relationship management (CRM) systems, as well as from their factory/production floors that requires to be transferred and archived for future retrieval (Morley, 2011). In 2010, Volvo Car Corporation embarked on an aggressive expansion strategy across the world establishing an elaborate network which required an appropriate platform to link the company’s business units, production and support plants together, and this was achieved through the company’s cloud infrastructure (Morley, 2011).

Moreover, Volvo has also being currently working closely with Microsoft to roll out Microsoft’s Business Productivity Online Suite as part of its strategy for increased integration of cloud computing into its networks. This boosted cloud infrastructure integration includes IT services such as messaging, email and collaboration tools that facilitates communication between the Volvo employees worldwide (Morley, 2011). The commitment of Volvo to integrate cloud infrastructure into its networks was echoed the company’s CIO Rich Strader when he said that cloud computing essential in replacing all of the company’s collaboration tools. Strader specifically pointed out that, for improved performance Volvo had no other option, but to adopt cloud computing (Asthana, 2011).

The integration of cloud infrastructure into the company’s networks has greatly helped the company as it continues to expand globally, by enabling instant communication and data transfer. Hence Volvo has taken advantage of this IT opportunity by securing Cloud services from Microsoft, the true leader in the Cloud Computing area in terms of providing collaboration tools. In overall, Volvo has succeeded in the integration of cloud infrastructure into its networks through enabling creation vehicles that are highly connected in an effective manner and in IT environments that are data-rich. For example, integration of cloud infrastructure into Volvo’s networks has significantly facilitated easy and convenient transmission of data captured from hundreds of CPUs and sensors embedded throughout the car back to the manufacturer (Morley, 2011).   In addition, Cloud Computing is being used in the optimization of manufacturing processes, boosting safety and enhancing customer interaction.

How Volvo Car Corporation Transforms Data into Knowledge

The success of Volvo so far is significantly attributed by its ability to transform data into knowledge. For example, the voluminous data generated by Volvo on daily basis is transformed into knowledge through analysis of the data streams to yield information that is useful (Fujitsu, 2011).  The company also has the ability of obtaining predictive information in early stages of car production on issues such as possible manufacturing defects that could occur in future, thereby taking the necessary corrective measures to prevent such occurrences from occurring.

The Volvo’s ability to effectively transform data into useful knowledge serves a great role in improving the safety of its cars because such knowledge gives Volvo big insights through analytic rapid or velocity and real-time analysis which helps the company to provide better services and achieve competitive advantage over their competitors (Fujitsu, 2011). However, this transformation of data to knowledge requires utilization of software that gives Volvo the privilege of making data driven decisions.  This is evident through the company’s continuous focus on safety which has made Volvo cars to be among the top rated in terms of safety, something that has been made possible through the company’s ability to timely review the safety of their cars from data collected from their vehicles.  Furthermore, data collected from Volvo cars that have been involved in accidents have been used to develop the most effective car maintenance plan since the technicians are able know when specific components of the car need to be checked, updated or replaced (Fujitsu, 2011).

Real-Time Information Systems Implemented by Volvo Car Corporation

Volvo Car Corporation implemented various real-time information systems such as Microsoft Server Production Portfolio including Microsoft SQL Server 2012 Business Intelligence, Microsoft SharePoint Server 2010, and Microsoft Office 2010 (Volvo Group, 2012).  Volvo also implemented Microsoft’s Business Productivity Online Suite, Microsoft SQL Server 2012 Analytical Services (for easy business analytics performance and reporting handling) and Microsoft SQL Server 2012 Reporting Services (Volvo Group, 2012). The impact implementing these real-time information systems is improved business efficiency and performance, reduced costs for not keeping licenses for multiple systems.  They have also enhanced Volvo’s business intelligence and collaboration due to improved communication and transfer of voluminous data over long distances in an easier and faster manner (Asthana, 2011).

Big Data Gives Volvo a Competitive Advantage

The Big Data strategy has been essential in giving Volvo competitive advantage in the market over its competitors.  The Big Data Strategy involving gathering of information from suppliers, distributers and consumers helps Volvo in providing better services and products to their customers because of its ability to anticipate their customers’ needs accurately (Asthana, 2011).  Big Data strategy also gives the company a competitive advantage by enabling it to use the analytical findings and near real time graphical reports to improve its design, engineering and manufacturing processes in order to produce high quality cars (Asthana, 2011).

Conclusion

Through establishing cloud infrastructure integrated IT networks, Volvo has the ability to clearly have competitive advantage over its competitors as well as being able to allow its employees almost instantaneous communication and voluminous data transfer to enable making of informed decisions.  The company has also been able to effectively extract knowledge from its voluminous data that adds value to the company’s products and services as well as been able to harness Big Data strategy to attain competitive advantage. Volvo has also managed to effectively implement real-time information systems that enable its employees to have effective communication, better Business Intelligence and richer collaborations, all of which have been working synergistically to allow improved product design and development as well as customer service delivery.

References

Morley, M. (2011). How the Cloud Helps Manufacturers Address ‘Big Data’ Challenges, Driving B2B Blog, http://www.gxsblogs.com/morleym/2011/10/how-the-cloud-helps-manufacturers-address-%E2%80%98big-data%E2%80%99-challenges.html

Asthana, P. (2011). Big Data and Little Data, Forbes Magazine at Forbes.com, http://www.forbes.com/sites/dell/2011/10/31/big-data-and-little-data/

Fujitsu (2011). Global Intelligence for the CIO Converting Data into Business Value at Volvo, Case Study Data Provided, http://www.i-cio.com/__data/assets/pdf_file/0004/8833/i-cio_Case_Study_Volvo.pdf

Volvo Group (2012). Collecting Driving Data to Improve Safety, http://www.volvogroup.com/group/global/en-gb/researchandtechnology/transport_society/enhancing_safety/collecting_data_for_safety/Pages/collecting_data_for_safety.aspx